Our View

From the Conference

Growing Federal Debt Hurts the Economy

Feb132012

Federal Reserve Chairman Bernanke Testifies That the Lack of a Budget Hurts the Economy …

When asked if the lack of certainty on tax and spending policies is hurting the economy, Chairman Bernanke candidly responded, "I think it is, because firms like to have certainty [and] like to be able to plan." (Washington Examiner)

Yet Senator Reid Still Refuses to Pass a Budget…

Senator Reid recently said that President Obama's budget is dead on arrival, claiming that "We do not need to bring a budget to the floor this year." (CQ Today)

And President Obama has broken another promise and failed to cut the deficit in half …

In 2009, President Obama promised to reduce the deficit by half. However, his most recent budget proposal projects a $1.33 trillion deficit in FY 2012, which is a record-setting fourth straight year of a deficit greater than $1 trillion. (President Obama, February 2009; CBO)

By the end of 2012, President Obama will have presided over the four worst annual deficits since 1947. (CBO)

President Obama's FY 2013 budget will add $11.2 trillion to the national debt over the next 10 years. President Obama's budget will increase the total debt per person to $75,000 in 2022, up from $33,000 per person in 2008. (Republican Staff, Senate Budget Committee)

Additionally, President Obama is proposing a massive tax increase of $1.9 trillion at a time when the U.S. economy can least afford it. These tax increases target small business owners and investors who are a key source of job creation and economic growth. (Republican Staff, Senate Budget Committee)

Under President Obama, the Debt Has Exploded and Jobs Have Disappeared

Economists have concluded that economic growth for countries with debt above 90 percent of GDP tends to be between 1 and 2 percent lower when compared to countries with lower debt-to-GDP ratios. Total national debt in the U.S. now exceeds 100 percent of GDP. (Republican Staff, Senate Budget Committee)